Raiffeisen: The region is not what it was but players remain committed

Things have changed radically in Central and Eastern Europe compared with 2008, with bankers now being concerned about the worsening of loan quality and seeking to find cheaper sources of funding, reveals a Raiffeisen Bank report. “On a regional level, we see individual efforts made by players to find the appropriate strategies to counter the rapid deterioration of asset quality and the rise in the cost of funding. However, the large groups in Central and Eastern Europe remain committed to the region, riskier markets included, as is the case of Ukraine, Hungary, Romania and Russia,” note Raiffeisen Bank analysts in their annual report on banking systems in the region. The collapse last autumn of American giant Lehman Brothers had a major impact on emerging economies in Central and Eastern Europe, which recorded export declines and severe declines in foreign investments. “Banking sectors in the region have been faced with a sudden drying up of liquidity and to a rise in non-performing loans. Banks responded by toughening lending terms and by laying more emphasis on attracting deposits, as a source for refinancing,” Raiffeisen Bank analysts also say.